Top U.S. Life Sciences Clusters Revealed: Did Your City Make the List?

SAN DIEGO, CA--(Marketwired - Jun 25, 2014) - Global shifts in the life sciences landscape may be rewriting the global map, but U.S. cities continue to lead the world in biopharmaceutical resources and enterprises. Access to talent and research is keeping cities like Boston, San Francisco and San Diego at the top of the U.S. life sciences clusters list. Factors shaping these clusters, and the city rankings, were revealed in JLL's (NYSE: JLL) third annual Global Life Sciences Cluster Report released today at the BIO International Convention.

"The right-sizing and reshuffling of the global biopharmaceutical companies has left its mark on key U.S. cities," said Roger Humphrey, Executive Managing Director of JLL's Life Sciences group. "The strongest U.S. clusters have retained their competitive advantages, and continue to thrive as top centers of talent and innovation."

The 2014 JLL Global Life Sciences Cluster Report analyses top U.S. life sciences clusters, ranks the cities for their prominence in the industry and also offers an analysis of global trends in 17 countries.

Top U.S. life sciences clusters

U.S. life sciences clusters with a large presence of small start-ups, mid-tier biotech firms and specialty companies flourished in 2013, with moderate increases in year-on-year employment and establishments. Conversely, clusters with a major-tenant base, such as large headquarter campuses or manufacturing sites, generally experienced declining employment. Below is the 2014 ranking of the top 10 U.S. life sciences clusters:

Rank

2014 Cluster Report (current)

2013 Cluster Report

Year-Over-Year Trends

1

Greater Boston (no change)

Greater Boston

-- Across the board, small and mid-size companies are driving most facility development and leasing transactions.
-- Boston remains the clear world leader.
-- San Diego's ranking drop is largely due to reduced demand for resources by mature companies as smaller enterprises have flourished.
-- Despite HQ relocations and consolidations, New Jersey/NYC/Westchester gained in rank.
-- No new additions or drop-offs to the Top 10.

2

San Francisco Bay Area (+1)

San Diego

3

San Diego (-1)

San Francisco Bay Area

4

Raleigh-Durham (no change)

Raleigh-Durham

5

New Jersey/NYC/Westchester (+2)

Philadelphia

6

Los Angeles/Orange County (+2)

Washington D.C. Metro Area

7

Philadelphia (-2)

New Jersey / New York City

8

Suburban Maryland/Metro Washington DC (-2)

Los Angeles / Orange County

9

Minneapolis/St. Paul (no change)

Minneapolis-St. Paul

10

Seattle (no change)

Seattle

Source: JLL 2014 Global Life Sciences Cluster Report

Boston continues to lead in life sciences resources

The Greater Boston Area once again tops the U.S cluster scorecard. Although San Diego and the San Francisco Bay Area reported higher year-over-year employment growth, Boston's ability to attract venture capital and U.S. National Institutes of Health funding secures its position as the top life sciences cluster in the world. All three cities are expected to lead the United States' life sciences industry in the coming years because of the critical mass of start-ups and mid-tier companies, leading research institutions, access to private and public funding, and local leaders focused on growing their life sciences industries. With three of the country's top 10 clusters, California is the top U.S. state for life sciences innovation.

"Los Angeles and Orange Counties' continued prominence as a global life sciences cluster underscores the immense talent and resources that are located within southern California and the County of San Bernardino," said Kelly Reenders, Economic Development Agency Administrator for San Bernardino County, part of the Los Angeles/Orange County life sciences cluster that ranked number six on JLL's list. "Our region has long provided leading centers of research such as the Loma Linda University Medical Center and Children's Hospital, and infrastructure such as manufacturing facilities and an educated workforce that support the life sciences."

Global shifts in innovation, markets

Following the "gloom and doom" era of patent expirations, depleted product pipelines and uncertainty in U.S. healthcare reform, 2013 brought new energy to the life sciences sector. As Big Pharma retrenches, small- to medium-sized companies and specialty players are steadily growing, propelling initial public offerings to a volume not seen in years. Across the board, small and mid-size companies are driving most facility development and leasing transactions.

As detailed in the 2011 Global Life Sciences Cluster Report, the life sciences industry's move to more profitable models has led to a facilities footprint evolution. More than a third of life sciences companies anticipate reducing or consolidating their real estate portfolios in European markets, while shifting production facilities or even entire business units and R&D centers to emerging markets, according to JLL's 2014 Corporate Real Estate Trends for the Life Sciences Sector survey of corporate real estate executives.

The need for strategic corporate real estate portfolio planning is at an all-time high, as companies of all sizes seek operating efficiencies. Beyond strategic site selection, the life sciences sector has become the most active in outsourcing portfolio and facilities management, according to the Corporate Real Estate Trends report, with 22 percent fully outsourcing these functions, compared to 13 percent in other industries. Facilities management outsourcing is expected to grow in the life sciences sector in the next three years, expanding "beyond the yellow line" to encompass management of laboratory and production equipment, hazardous waste, supply chain, facilities regulatory compliance and other critical areas.

About the Report

JLL's annual Global Life Sciences Cluster Report tracks geographic shifts in life sciences innovation, operations and facilities investments, including analysis of countries and cities most actively investing in their life sciences sectors. It includes a ranking of the top U.S. life sciences clusters, as well as analyses of life science hotspots around the world. The complete findings of the Global Life Sciences Cluster Report are available in a dedicated microsite here: http://www.jll.com/cluster-report.

JLL offers a team of real estate and facility management experts dedicated to helping life sciences companies optimize and manage their real estate portfolios. The firm provides a comprehensive range of facilities management services to the life sciences community covering 75 million square feet of research, manufacturing and commercial space. Its industry leading full-service platform includes: integrated facilities management, engineering and operations, energy and sustainability, transaction advisory services, lease administration, project management and a platform for comprehensive laboratory services, Labwell.

A leader in the real estate outsourcing field, JLL's Corporate Solutions business helps corporations improve productivity in the cost, efficiency and performance of their national, regional or global real estate portfolios by creating outsourcing partnerships to manage and execute a range of corporate real estate services. This service delivery capability helps corporations improve business performance, particularly as companies turn to the outsourcing of their real estate activity as a way to manage expenses and enhance profitability.

For more news, videos and research resources on JLL, please visit the firm's global media center Web page http://bit.ly/18P2tkv.

About JLL

JLL (NYSE: JLL) is a professional services and investment management firm offering specialized real estate services to clients seeking increased value by owning, occupying and investing in real estate. With annual fee revenue of $4 billion, JLL has more than 200 corporate offices and operates in 75 countries worldwide. On behalf of its clients, the firm provides management and real estate outsourcing services for a property portfolio of 3 billion square feet and completed $99 billion in sales, acquisitions and finance transactions in 2013. Its investment management business, LaSalle Investment Management, has $48.0 billion of real estate assets under management. JLL is the brand name of Jones Lang LaSalle Incorporated. For further information, visit www.jll.com.